Home Depot sales rise due to hurricane recovery

Home Depot expects a smaller decline in annual store sales after posting better-than-expected performance in the last three months, driven in part by post-hurricane recovery efforts.

“As the weather normalized, we saw better exposure to seasonal merchandise and certain outdoor projects, as well as increasing sales related to hurricane demand,” CEO Ted Decker said in the company’s earnings release on Tuesday.

Decker told analysts on Tuesday that the company’s third-quarter performance exceeded expectations despite “macroeconomic uncertainty.”

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The company’s shares rose during trading on Tuesday following better-than-expected results.

Joe Feldman, senior managing director of Telsey Advisory Group, said in a statement Tuesday that “warmer and drier weather” increased demand for summer categories such as paint and outdoor grills, and recovery efforts from Hurricanes Helene and Milton boosted sales of generators, batteries, Plywood etc. boosted building materials.

Revenue jumped to $40.22 billion in the quarter, beating analysts’ expectations of $39.31 billion.

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Sales at stores open at least a year fell 1.3%, marking the eighth straight quarter of decline. However, this is below the average analyst estimate of a 3.25% decline.

Workers, community members and business owners clear debris after Hurricane Helene in Marshall, North Carolina, Monday, Sept. 30, 2024. (Jabin Botsford/The Washington Post via Getty Images / Getty Images)

Store sales in the US fell 1.2%.

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The company now expects comparable sales for fiscal 2024 to decline 2.5%, after previously expecting a decline of between 3% and 4%.

Like its competitors, Home Depot was negatively impacted by real estate market conditions that prevented consumers from making major renovations or moves.

Decker told analysts on Tuesday that there was still “pressure for major renovation projects due to the higher interest rate environment and ongoing macroeconomic uncertainty.”

However, Feldman believes the business “has upside potential from here on out” and says the Federal Reserve’s rate cuts “should boost demand in the industry across the board.”

Reuters contributed to this report.